Soybeans Commentary


Soybeans – Just My Opinion

May Soybeans closed 3 ½ cents lower ($8.14 ¼), July 3 ½ cents lower ($8.27 ¼) & Nov 2 ½ cents lower ($8.50 ½)

May Soybean Meal closed $0.3 higher ($288.7), July $0.3 lower ($292.9) & Dec $0.1 higher ($300.7)

May Soybean Oil closed 10 pts lower ($26.71), July 10 pts lower ($27.10) & Dec 10 pts lower ($27.75)

Weekly Soybean Export Sales – old crop vs. 300-650 K T. expected – new crop vs. 50-450 K T. expected

Weekly Soybean Meal Export Sales – old crop vs. 75-250 K T. expected – new crop vs. 0-50 K T. expected

Weekly Soybean Oil Export Sales – old crop vs. 5-26 K T. expected – new crop vs. none expected

Deal or no Deal – Tariffs or no Tariffs?? Unfortunately I think that’s what it is going to come down to if the soybean complex is to be rescued. Are we going to see more acres switched to soybeans due to slow corn planting? Most in the trade are expecting to see the USDA suggest a larger old crop soybean carryout and a hefty looking new crop soybean carryout. It is my thought that if the US and China can come to terms with a trade deal it would go far in offsetting the expected large carryout figures. Without a trade deal I would not be surprised to see the soybean market set a new precedent as far as oversold indicators are concerned.

Most interior soybean basis locations are either running steady or lower. Logistical problems on the riverways leading to the Gulf will persist for the near future. Just how much rain we see out of the current system will dictate how long the transportation problems persist. Then again our soybean export demand is nothing to write home. This is why the Gulf basis has been very quiet despite the transportation problems. The processor continues to show the most consistent basis out there due to the profitable crush margins. Soybean spreads ran steady in the old crop while old crop continues to ease against the new crop. Not much happens with the cash meal basis in the interior as well as for export. Meal spreads mirrored the action of the soybean spreads; steady upfront while old crop eases to the new crop.

The 14-day RSI for July soybeans sits at 16.5 and for November 15.4. Normally these oversold levels would attract some decent attention but with the “deal or no deal” hanging over the market’s head no one is making a move. the product markets are nowhere near as oversold but still equally as depressed looking. July meal registered new contract lows as well as a new contract low close. July bean oil is not far behind. Given all of the blustering I see coming out of the WH vs. China supposedly wanting to make a deal (the WH said it I didn’t) I’ll just have to sit on my hands to see how it all pans out.

Daily Support & Resistance for 05/09

July Soybeans: $8.17 – $8.34

July Soybean Meal: $290.0 (?) – 296.0

July Soybean Oil: $26.50 – $27.40

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